Ant Financial, Vanguard Group target 900m users with robo adviser

Photographer: AFP/Getty Images

Vanguard Group and Ant Financial’s joint venture is rolling out a new robo adviser to target the Chinese fintech giant’s 900 million users, a first step in winning a slice of the nation’s fast growing asset management business.

The venture started offering an automated service called “Bang Ni Tou” (Help You Invest), to capture people with at least 800 yuan ($113) to place in mutual funds, the companies said on Thursday.

“What we do is help users select an entire football team, instead of just one player,” Peter Zhang, chief executive officer of Vanguard Investment Advisors (Shanghai) Investment Consultancy Co., said in an interview. “We help our users by selecting a portfolio of investments that generate long-term returns.”

While the coronavirus outbreak has rocked the Chinese economy, the nation is proceeding apace with the further opening of its financial industry this month. Foreign asset managers are now rushing in to establish a foothold in a retail funds market that could grow to $3.4 trillion by 2023.

Ant, controlled by billionaire Jack Ma, is a $150 billion juggernaut that operates everything from payments to money market funds and credit scoring, The new joint venture — in which Ant holds a 51% stake and Vanguard 49% — has been approved by the China Securities Regulatory Commission.

The robo adviser will recommend a portfolio selected from 6,000 mutual funds, after assessing the user’s risk appetite and investment horizon. The transactions are done automatically and the robo adviser will also help investors re-balance their portfolios if necessary.

Users can access the service through the apps Alipay and Ant Fortune, a wealth management platform.

Clare Zhao, the general manager at Vanguard Investment Management (Shanghai) Ltd., said the company’s main work with Ant is to create a service that’s as easy to use as possible.

The company has hired multiple dozens of people, said Zhang, who declined to be more specific on hiring and divulge revenue and user targets. The robo adviser charges a 0.5% management fee, with Ant and Vanguard splitting the profit based on their stakes in the venture.

China’s robo-ad­vi­sory market is expected to reach 737 billion yuan by 2022, according to a report by Lufax and consultant iResearch. Traditional financial institutions and a slew of fintech startups are gearing up to grab market share, including state-backed giants such as Industrial & Commercial Bank of China Ltd. and China Merchants Bank Co., according to the report.

In addition to Vanguard, Ant also partners with other international asset managers such as Fidelity International, Schroders Plc and UBS Group AG. Currently, these companies mainly work through Ant’s Caifuhao, an AI-powered corporate account on its wealth management platform, to provide customized investor education.

Ant plans to work with more international financial institutions in the future, it said in a statement.

Vanguard services 30 million investors globally, managing $6.2 trillion of assets as of January.

Bloomberg

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.